Total cost of ownership (TCO) is a commonly used metric for measuring whether to purchase a computing system for an enterprise, and in determining how to optimize the use, or deployment of, such a computing system. There exist various approaches to assess the TCO for a computing system, offered on the one hand by information technology (IT) analysts (for example, Gartner, Meta, Forrester, etc.), and on the other hand by various software and hardware vendors (Microsoft, Oracle, etc). As such, there has not developed a common standardized understanding about what TCO is all about and what are the reference parameters classifying it. Existing approaches differ in either the time they take into account in determining TCO, in the cost components and elements that are considered relevant to a TCO determination and in the reference parameters needed for data classification. For example, Meta in its TCO approach does not take into account indirect costs, while Gartner within its classical TCO approach does not take into account project costs like system implementation.
In addition, in that IT analysts have a different understanding about what cost components should be considered, IT analysts therefore also have a different understanding of what time frame to consider when investigating TCO. For example, Gartner in its standard TCO benchmark metric only takes into account a one year time frame. Also, while Meta does not take into account indirect costs, Gartner does take such costs into account. Finally regarding the degree of breakdown of the cost components included in a TCO analysis, while Meta only determines a total sum for operations costs with no detailed breakdown, Gartner has a more detailed break-out of cost components included for operations. The reason is that Gartner mainly focuses on operation costs when assessing TCO for a computer system